A leader of the outlawed Unified Buddhist Church of Vietnam (UBCV) has shown his support to Hanoi Catholics, in their quest to regain confiscated church property. He said the state-approved Buddhist leaders, who claimed the property was theirs, were: “tools of the Communist Party”.

Hanoi Catholics who earlier this month won a government promise to restore Church control of the building that once housed the apostolic nunciature, now face a serious complication, as a state-approved Buddhist group has claimed ownership of the land. In a letter sent to the prime minister of Vietnam – dated February 16 – Venerable Thich Trung Hau, a leader of the Vietnam Buddhist Church (VBC) stated that any handover of property to the Catholic Church could not take place without the approval of the VBC, because he said, they were the authentic owners of the land. He argued that on the land in dispute there had been a pagoda named Bao Thien built in 1054. In 1883, “The French colonists seized and gave it to Bishop Puginier”, he stated.

However, in an interview with the BBC on 23 February, Venerable Thich Khong Tanh, Commissioner for Social and Humanitarian Affairs of UBCV stated that the Catholic Church is actually the legal owner of the land. “The Catholic Church”, he said “legally owned the land before the VBD was established, and even before Hau was born”.

A state-run magazine published in 2001 states that the Bao Thien pagoda was destroyed in 1426 and that it was located in another place about 5km in the north of the nunciature. The plot of land on which the archbishop’s residence, the city’s Catholic cathedral, and St Joseph seminary are located had been vacant for a long time before 1883, when these building were constructed.

Thich Khong Tanh questions the political motive of the VBD leadership. “It is clear that the government is reluctant to satisfy the legitimate aspirations of Catholics. Now, they want to use Buddhists to confront the Catholics for them”, he said urging Vietnam Buddhists not allow the government to do so.

He pointed out that the UBCV has no dealings with the Catholic Church, but added that two key UBCV institutions have also been seized by the government: the Vietnam Quoc Tu Pagoda and the Quang Duc Cultural Centre in Saigon.

The UBCV, which claims to lead 80% of Buddhists in Vietnam, has been outlawed since 1981, when the atheist government set up the state-controlled VBC. Like other Buddhist monks in UBCV, Venerable Thich Khong Tanh, 65,has spent 15 years in prison for his faith and is an outspoken advocacy of human rights.

Father Joseph Nguyen from Hanoi reported that some government officials have already criticized those involved in the letter of Thich Trung Hau. This development may drive Catholics to cooperate with the UBCV in future.

The state-sponsored Vietnam Buddhist Church in Hanoi is going to host the upcoming international celebrations of the 2008 Vesak Festival ­ the Anniversary of the Birth of Buddha. Up til now, celebrations have taken place in Thailand. This year, Vietnam asked the Thai government to allow Hanoi to host the Vesak festival. This looks set to pose additional tensions in the country.

HANOI (Thomson Financial) – Vietnamese consumer prices rose more than 15 percent year-on-year in February, according to official figures released Thursday, heightening inflation concerns especially for the poor.

The General Statistics Office (GSO) said the consumer price index (CPI) for February rose 15.67 percent compared to the same period last year.

The figure was the highest registered year-on-year increase for February in the last decade, said a GSO economist who declined to be named.

The GSO said February food prices rose 25.2 percent year-on-year, with rice and other grains increasing by 17.7 percent.

Communist Vietnam wants to restrict consumer price hikes to no higher than planned economic growth of between 8.5 to 9.0 percent for the year.

But on Monday Hanoi hiked fuel prices at the pump by 11 percent to cope with record world oil prices of more than 100 US dollars a barrel.

A finance ministry official, who declined to be named, said the rise was designed to combat oil smuggling between Vietnam and neighbouring countries.

However, it also raised fears of worsening inflation.

‘Fuel price hikes will surely push up prices for other products,’ Nguyen Minh Phong at the Institute for Social Economic Studies told a local newspaper.

HANOI: Instead of heading to the bank to change U.S. dollars into Vietnamese dong, a travel agent searches for another businessman to act as his counterparty.

Shortages of the dong are causing ripples through Vietnam’s banking system, businesses and the country’s fledgling stock markets after measures by the central bank to dry up liquidity to fight double-digit inflation.

The tightening means that banks are trying to preserve their dong holdings, forcing many businesses to operate outside of the banking system when they want to change dollars for dong.

“We have to find a business who wants to buy the dollar for their payment needs if we want to convert our dollars into the dong and sometimes that can be difficult and more costly,” said the owner of a travel agency that handles international tours and has an account at a major state-run bank. The business person spoke only on condition of anonymity.

Many local and foreign bankers, traders and businessmen declined to be identified with their comments on the liquidity crunch because of the sensitivity of the issue in one-party Communist-ruled Vietnam.

On Hanoi’s unofficial foreign exchange trading street, Ha Trung, business is brisk at a congested strip of shops where the dollar and fat stacks of dong change hands over the counter.

One dollar buys 15,800 dong on the black market, compared with the central bank’s published rate of 16,054 dong.

Several banks in Hanoi said this week they would not buy dollars from nonclients. Only about 10 percent of the country’s 85 million people have bank accounts in what has largely been a cash economy even with market reforms.

Officials at the State Bank of Vietnam in charge of foreign exchange and banking transactions declined requests for comment on policies or the liquidity crunch, which peaked this month around the Lunar New Year festival, or Tet, when cash demand was highest.

In one tightening measure, the central bank said it would oblige commercial banks to buy 20.3 trillion dong, or $1.26 billion, of treasury notes. That will squeeze more dong from the banks.

The news last week sent the Ho Chi Minh Stock Exchange down 16 percent after panicked selling by local retail investors who dominate the small $20 billion market.

Overnight loans, primarily used by banks to make sure they have sufficient funds to balance their books, have climbed as high as 40 percent in the interbank market in February.

Short-term interest rates have also been volatile, shooting up to 15 percent last week before coming down this week to 10 percent.

The central bank stepped in Wednesday to try to stabilize the market by ordering banks to cap the rates on dong deposits at 12 percent.

Vietnamese rice traders also described their difficulty getting dong for dollars. Vietnam is the world’s second-largest rice exporter after Thailand.

After loans jumped 37.8 percent last year, some central bank money supply tightening measures coincided with high demand at Tet, presenting commercial banks with a situation they had never faced in the underdeveloped financial system, foreign bankers said.

The Asian Development Bank and a number of economists say the international financial crisis and a slowdown in the U.S. economy would have an impact on growth. Vietnam has a large trade exposure to the United States.

Vietnam’s inflation is at decade highs and money markets are extremely volatile, but the bigger worry for economists is that the central bank is inexperienced and ill-equipped to deal with the pressures of moving to a market economy.

“They are struggling with issues that are kind of new for them and, on the face of it, they are behind the curve,” said Tim Condon, an economist at ING.

“So, they have to do everything they have done and more. Broad-based tightening has to be done very quickly to prevent inflation from doubling again in the next half year and all forms of liquidity absorption need to be brought to bear,” Condon said.

A severe shortage of dong, Vietnam’s currency, has been causing headaches for foreign businesses in the country as the government tries to control inflation by reining in the supply of notes.

In one sign of the currency crunch, last week Hanoi was forced to give special permission to Morgan Stanley to pay $217m in dollars for a 10 per cent stake in PetroVietnam Finance Corp, instead of making the payment in dong, as is normally required by law.

Elsewhere, an accountant for a foreign firm tried to convert $30,000 into local currency to pay staff salaries and office rent but was turned away when the bank said it did not have enough dong.

“It’s outrageous,” said a foreign executive, spurned in a recent attempt to convert dollars to dong. “We are going to have to go to the automatic teller machine and draw money out to pay salaries by hand.”

A number of foreign businesses have been affected in recent weeks, as the State Bank of Vietnam, the central bank, tries to drain liquidity from the financial system to control inflation and hold down the value of the dong against the dollar.

For the past four months, international bankers and economists said, the central bank had curbed its purchases of dollars, refusing to accommodate commercial banks seeking to offload dollars and acquire dong.

Overnight inter-bank rates for the currency have reached as high as 40 per cent recently although rates dropped last week to 9 -10 per cent when the central bank injected some additional liquidity into the system.

“The State Bank of Vietnam understands that inflation is partly caused by the rapid growth of the money supply,” said Jonathan Pincus, chief economist at the United Nations Development Program. “One way to squeeze the supply of Vietnam dong would be to stop buying dollars.”

Commercial banks in Vietnam will soon have to take another hit from the central bank, which has announced it will require big banks to buy Treasury bills at interest rates below inflation – in another move to drain liquidity from the system.

The central bank says that 41 big banks and credit organisations will have to buy a total of $1.27bn worth of one-year Treasury bills with an interest rate of 7.8 per cent.

Hanoi – Singapore President Sellapan Rama Nathan, arriving in Vietnam on an official visit, urged his hosts to take advantage of Singaporean expertise to unclog the country’s congested ports and transportation infrastructure. “One of your problems is infrastructure,” Nathan said in a meeting with his counterpart, Vietnamese President Nguyen Minh Triet. “You need to address the problem of containers moving in and out of your main ports.”Vietnam’s economy, which grew more than 8 per cent in 2007, has begun to run into bottlenecks as its transportation infrastructure proves inadequate to rising volumes of exports. A report delivered last December by Paul Hoogwaerts of the shipping firm Maersk International warned that Vietnam needed immediate investment in roads and container ports near the southern economic capital of Ho Chi Minh City. The report said failure to meet road construction deadlines in the next two years would have a “serious impact on Vietnam’s long-term economic growth and development.”Nathan also warned of the need for greater economic integration among South-East Asian countries in order to compete with the vast markets of India and China. “Unless we develop ASEAN as an area of 500 million people and an integrated society, foreign investment will move away from us,” Nathan said. Triet said Singapore’s high level of economic development served as a model for Vietnam. “Singapore’s development is very important in encouraging many other economies to develop, including Vietnam.”Vietnamese government officials regularly travel to the city-state for study tours on economic management and anti-corruption efforts. Singapore is the second-largest source of foreign direct investment in Vietnam after South Korea, with 10.6 billion dollars. Bilateral trade between the two countries reached 8.6 billion dollars in 2007. Trade between Vietnam and the US, its largest export market, was 12.2 billion dollars. Nathan said Singaporean firm CapitaLand, the largest real estate developer in Southeast Asia, planned to sign deals with Vietnamese investors during his trip.

The Vietnamese government is often embroiled in complex disputes over land rights.

But there is one particular row that is currently making the headlines – pitting the government against the country’s strong Catholic Church, and now the Buddhist community as well.

For the whole of January, thousands of Catholics gathered outside the building that served as the Vatican ambassador’s residence in Hanoi during the 1950s.

Braving the coldest winter for 40 years, they held vigils and prayers in one of the most visible gatherings in decades.

They had one request – that the site be returned to the Catholic Church.

The last Apostolic delegate was expelled by the Communists in 1959 and, since then, the residence has been used by the local Communist People’s Committee for various non-religious purposes, such as weddings, motorbike parking and a gymnasium.

The case has highlighted the complexity of land issues in Vietnam, especially where religions are involved.

Protests by Catholics in January alarmed the government

It has also caused considerable alarm to the authorities.

They demanded that the Catholic protesters stop their vigil, and some were prosecuted for “abusing religion to cause public disorder”.

In the end, the crowds only dispersed when the Archbishop of Hanoi, Joseph Ngo Quang Kiet, announced that the government had promised to give back the land.

But the issue has still not been resolved – and the land has yet to be returned.

Before the Catholics could show their discontent again, an official letter signed by the Venerable Thich Trung Hau, a leader of the official Buddhist Church, was sent to the prime minister.

Land use is one of the most complex and sensitive issues in Vietnam

Nguyen Duc Thinh,
Religious Affairs Committee

The letter said the disputed land was in fact the location of an ancient pagoda – one of the most important heritage sites of Vietnamese Buddhism – which was occupied by the French and given to the Catholic Church in the 19th Century.

It asked the government to “consider the Buddhist Sangha one of the main parties to consult before making any decision” regarding the site.

The letter has sparked an angry reaction from the Catholic community.

Online forums such as the VietCatholic website have been swamped with articles and messages saying that only the Catholic Church has rights to the land that they believe was “given to the Church by history”.

Some followers of the outlawed Vietnam Unified Buddhist Church also criticised the state-approved Buddhist Sangha’s claim, which they feared would only widen the division between the two religions.

Some are worried the dispute could exacerbate religious divisions

Religious issues have always been considered “sensitive” in this communist country.

But tricky as it is, the claim by the Buddhists could, in reality, help make the government’s task simpler.

“With both the Catholic and Buddhist Churches vying for the land, the government can now take the religious nuance off the issue, and treat it as a pure land issue,” said one leading cultural expert. “It could come down to basic documentation.”

Even straight land disputes, though, are not easy to solve.

Land clearance for industrial development, the confiscation of agricultural land and the lack of fair compensation for farmers have all fuelled a number of large-scale public protests in recent years.

“Land use is one of the most complex and sensitive issues in Vietnam,” said Nguyen Duc Thinh, a senior official from the government’s Religious Affairs Committee.

“Our policy is to examine all disputes, case by case, in accordance with the government’s land law,” he said.

Vietnamese law stipulates national ownership over all land, which means that organisations and individuals can only apply for the rights to use land, not own it.

Great value

Real estate prices in Vietnam have rocketed during the past decade.

In central Hanoi and Ho Chi Minh City, commercial space can sell for as high as in some of the most expensive cities in the world.

The disputed former Vatican ambassador’s residence, covering an area of one hectare, is no doubt of great financial value.

“We have come to recognise that the Hanoi Diocese does indeed need a premise for their activities,” said Nguyen Duc Thinh.

But he admitted that, like many land disputes, this one would take time to resolve.

Hanoi, Feb 23, 2008 / 01:29 pm (CNA).- A Buddhist leader in Vietnam is now asserting a claim to disputed land that once belonged to the papal nuncio but was confiscated by the Vietnam government in 1959.

After a month of Catholic protest and prayer seeking the return of the former nunciature, Archbishop Joseph Ngo Quang Kiet announced an agreement on February 1 that would restore the property to Catholic ownership.

However, in a February 16 letter to the Vietnamese prime minister Venerable Thich Trung Hau, a leader of the communist-organized Vietnam Buddhist Church, now claims the land belongs to Buddhists.

Venerable Hau said that a pagoda named Bao Thien was built on the land in 1054. In 1883, he claimed, “The French colonists seized [the land] and gave it to Bishop Puginier.”

Catholics see the claim as a government ploy to undermine the agreement announced on February 1.

The fence surrounding the former nunciature was broken through during the aforementioned Catholic protests and prayer vigils. Recently the gates of the fence have been strengthened, while new panels carrying Communist symbols and slogans have been set in place. Security officials now reportedly respond quickly to remove anyone who pauses to pray outside the building.

Father Joseph Nguyen, a Hanoi priest involved in the protests, said that Hanoi Catholics are facing “uphill battles” to regain the property. He also responded to the Buddhist leader’s claim, saying, “Except the strong support from the government, Venerable Hau has nothing to prove what he said. On the contrary, we do have all legal land titles.”